Ethanol mandate: Queensland government to mandate E10 fuel sales

Ethanol is set to be mandated for Queensland fuel sellers, with the government aiming for E10 fuel to make up 20 per cent of regular petrol sales from July next year.

In introducing the bill, which Labor had promised to investigate as part of a commitment to the Katter Party MPs to look into biofuels, Energy Minister Mark Bailey said after consultation, the government would move for all fuel sellers to register with government from January next year.

The Queensland Government has introduce legislation to mandate ethanol in fuel.

It hopes to commence the mandate from the start of the next financial year.

The bill, if passed, will see a 2 per cent ethanol mandate, which equates to 20 per cent of non-premium petrol sales, meaning petrol stations would have to sell one litre of biofuel for every four litres of regular unleaded fuel.

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"The 2 per cent is to be calculated against total sales of regular unleaded petrol plus a regular bio based petrol blend, such as E10, but excludes premium petrol," Mr Bailey said.

Mr Bailey said it was time Queensland took advantage of the bio-fuel industry.

"In 2014, the United States produced about 4.5 billion litres of bio-diesel," he said.

"The bio-fuel industry in Queensland and particularly ethanol, has struggled to advance due to lack of long-term policy certainty.

"Unfortunately, there have been a number of 'false starts' to an ethanol mandate, including a proposal for a legislated mandate to start at the end of 2010. Use of ethanol blended fuel in Queensland peaked in 2010 to 2011 at around 900 million litres, or 2.7 per cent of regular unleaded petrol sold, but has since fallen to around 350 million litres in 2013 to 2014, or about 1.2 per cent of regular unleaded petrol.

"A legislated mandate of 2 per cent for bio-based petrol such as ethanol will therefore provide the policy certainty that industry can take as a solid commitment from government to back the growth of a vibrant bio-fuels and bio-manufacturing industry in Queensland."

The legislation leaves room for the mandate to increase, with the government aiming for growth in the industry as a whole. Petrol retailers will be monitored, through their required registration, to ensure they are complying with the mandate, but the government will also embark on an education campaign, if the legislation passes as expected, planned to complement its roll out.

The legislation has been sent for review, with the bill expected to be passed by the end of the year.